When you file for bankruptcy, you will be asked to pay an Inland Revenue Authority of Singapore (IRAS) tax known as the Individual Voluntary Arrangement (IVA) fee. This fee can cost up to S$1,500 and it applies whether or not you are granted an IVA fee, which means that if your IVA application is rejected, you still have to pay the full amount of the IVA fees even though you will have nothing to show for it.
Learn About Your Options
Once you’ve hit financial rock bottom, your first inclination might be to jump on a magic bullet: filing for bankruptcy or applying for an Individual Voluntary Arrangement (IVA). But before you do either of these things, sit down and figure out all of your options. Many people automatically assume they should file bankruptcy or apply for an IVA without taking time to learn about their other options.
Learning about your options can help you, save money and perhaps even preserve certain assets in a way that protects them from seizure by creditors. If you’re thinking about filing for bankruptcy or applying for an IVA, look at Chapter 13 bankruptcy as well as insolvency options like debt consolidation loans.
Compare Monthly Payments
When you apply for an IVA, there are monthly payments that must be made. It’s important to know how your payments will stack up against your current monthly payments so you can prepare yourself for any sudden changes.
By comparing monthly payments on a spreadsheet or through online tools, you can see exactly how much more or less money you’ll have each month with an IVA. Many people are surprised when they realize that their post-IVA payment plan is actually less than what they were previously paying every month! If that sounds good to you, it’s time to get started applying.
Can I Still Use IVA if My Income Has Changed?
One of the best things about IVA fees is that they’re flexible. But, some changes in your personal circumstances will have a big impact on how much you’ll pay, or if you even qualify at all. Changes in your income levels might make an IVA harder—or it might make it easier. You won’t know until you check with a professional.
The same applies if your employment status changes from full-time to part-time, or from salaried to hourly—it could put a dent in your savings, but that doesn’t mean you can’t apply for an IVA and get back on track!
What are the Consequences of Not Repaying My Debt?
It’s important to understand what will happen if you don’t pay your debt. Will your creditor come after you or sue you? Or, will they sell your debt on a debt-collection agency? If so, are there other consequences like damaged credit or a bad credit score?
By thinking through what might happen if you stop paying, you’ll be better prepared to make smart decisions when facing financial hardship. For example, if you anticipate that creditors might come after you for your debt, it makes sense to have enough cash saved up or access to income that could cover outstanding payments—otherwise, it may be better not to repay debt at all.
What Happens if I Still Can’t Repay My Debt After Completing an IVA?
It’s unlikely that you’ll have fully repay your debts after completing an IVA, but that doesn’t mean your debt is forgive. In fact, if you haven’t fully repay what you owe, then you still need to make payments after completing your IVA.
but they will be much lower than they were beforehand. In most cases, monthly payments of less than £25 are all it takes to get back on track with debt repayment. And as long as you continue making those payments every month, there shouldn’t be any additional penalties or fees attached when it comes time to pay off your remaining debts.
If I Complete An IVA Will It Affects my Credit Rating?
You might be concerned that your bad credit rating will affect you in future years. You may fear that lenders will look. at your poor credit history, and turn you down. when you apply for a mortgage or other loan.
But even if creditors know about your past, they can’t report it on your record until 7 years have passed. This means a short-term solution like an IVA could be exactly what you need to get back on track with your finances and avoid such issues later on.
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